The regions are ripe for building digital businesses

Launching a business in the bowels of what has been described by the Associated Press as a “savage recession” in Ireland may give some entrepreneurs heart palpitations, but not John McNamara.

For McNamara, co-founder of the 100pc Irish-owned Interactive Mobile Marketing and its first product, Sendmode, a provider of direct marketing solutions by SMS, the timing couldn’t have been more auspicious. McNamara and his wife had packed up after living in Dublin for a few years to buy a house in the Gaeltacht area of Co Donegal, with Sendmode being born in January 2009.

The product, he says, provides the lowest-cost bulk-text solution in Ireland and the UK.

The move to Co Donegal was a lifestyle choice, says McNamara, who founded Interactive Mobile Marketing in 2008 with Barry Murphy. “My background is technology, so location wasn’t really an issue.”

Boom during a bust

Neither was the state of the economy, really. There are lots of advantages to launching a business after the Celtic Tiger’s roar became a hoarse whisper, according to McNamara.

“You realise very quickly that things like rent and office spaces can be negotiated hard,” he says.

“We also went out in the market with the product. The market tells us very quickly that price is a huge issue … We were able to move very quickly on the pricing of our product and the service we offer.”

McNamara’s work on Sendmode took root in a nearly empty restaurant where he had been pondering how a lot of businesses had been having a tough time.

“We thought we could use mobile-phone technology to bring a product out,” he says of that day in the restaurant. “We knew there were products in this space, but we wanted to bring out a product that was accessible to all businesses, to use mobile marketing to get the message out to customers. That drove us to research how we could become the lowest-cost provider and how we could provide the best service.”

The timing, McNamara says, was also reflective of the company as a small operation.

“Another part in starting a small technology business is we can be very flexible. A lot of the larger businesses would be tight on overheads whereas, as a small business, we have complete control over all our overheads. That gives us the flexibility to pass on all savings to consumers.”

Entrepreneurship lesson

In researching the market and starting his business, McNamara not only discovered demand for his product, but also a learning curve.

“Our background is technology, so we’re learning a lot about business … It’s quite hard to get on the phone and ring people up and have them say ‘no’. At this stage, we’re very comfortable with the sales part.”

His persistence has been worth it. The company is growing and has already signed deals for 2010, its first fairly substantial deal for €100,000 and its first iPhone contract, details of which are under wraps for now.

Also for 2010, the firm wants to begin releasing smart phone applications and increase its client numbers, which are now at around 500.

“We’ve got a lot of UK clients now,” says McNamara. “We get between three and five clients pretty much every day. Some may be very small, some may be local butchers, but then some may be more established businesses such as Celtic Bookmakers. I think everyone is looking for the same thing: a good, low-cost way of getting the message out to customers.”

Now sending out 500,000 messages per month, the company expects to reach one million by the second quarter of 2010.

Taking a risk of not only starting a business, but starting one during a recession and in a more rural part of Ireland, has paid off for McNamara. He cites hard work.